[Federal Register Volume 64, Number 169 (Wednesday, September 1, 1999)]
[Notices]
[Pages 47887-47888]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-22695]
[[Page 47887]]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-41780; File No. SR-Phlx-99-20]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of a Proposed Rule Change by the Philadelphia Stock
Exchange, Inc., Relating to Amendments to Schedule of Dues, Fees, and
Charges
August 23, 1999.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 hereunder,\2\ notice is hereby given that
on June 23, 1999, the Philadelphia Stock Exchange, Inc. (``Phlx'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items I, II, and III below, which Items have been prepared by the
Exchange. On June 28, June 30, and July 22, 1999, the Exchange
submitted Amendment Nos. 1,\3\ 2 \4\ and 3,\5\ respectively, to the
proposed rule change.\6\
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ In Amendment No. 1, the Exchange clarified that the proposed
new foreign currency options ``participation fee'' would be
effective as of July 1, 1999, but that only those foreign options
participants holding legal title as of July 30, 1999 would be
responsible for paying the fee. See Letter and attached amendment
from Murray Ross, Vice President and Secretary, Phlx, to Michael
Walinskas, Associate Director, Division of Market Regulation
(``Division''), Commission, dated June 25, 1999 (``Amendment No.
1'').
\4\ In Amendment No. 2, the Exchange replaced the text of the
original proposed rule change. The amendment: (a) purported to
create a technology fee exemption for foreign currency options
participants who do not hold Phlx membership; (b) incorporated the
change from Amendment No. 1 regarding the effective date of the
participation fee; and (c) made typographical changes to the
proposed fee schedule. See Letter and attached amendment from Murray
Ross, Phlx, to Michael Walinskas, Division, Commission, dated June
29, 1999 (``Amendment No. 2'').
\5\ In Amendment No. 3, the Exchange stated that the technology
fee exemption was for foreign currency options participants who also
hold Phlx memberships. The Exchange also stated that the foreign
currency options participation fee was intended to address costs
associated with the foreign currency options program including
occupancy, Securities Industry Automation Corporation night
processing, market data feeds, staffing and communications. Phlx
also clarified that the proposed fee would not address Year 2000-
related events. See Letter and attached amendment from Nandita
Yagnick, Attorney, Phlx, to Michael Walinskas, Division, Commission,
dated July 21, 1999 (``Amendment No. 3'').
\6\ Because of the substantive nature of the amendments, the
Commission deems the proposal to be filed on July 22, 1999, the date
the last amendment was filed.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of
Substance of the Proposed Rule Change
The Exchange proposes to amend its schedule of dues, fees, and
charges to require all foreign currency options participants, as
defined by Phlx By-Law Article I, Section (i), to pay a new annual
participation fee of $2,000, billed semi-annually, to be effective July
1, 1999, and payable July 30, 1999. The Exchange also seeks to clarify
that it will bill its existing technology fee semi-annually (not
monthly), and that the technology fee is not applicable to foreign
currency option participants who hold title to a Phlx membership. The
Exchange also proposes to make typographical changes to its fee
schedule. The text of the proposed changes to the Phlx fee schedule may
be examined in the places specified in Item IV below.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
Sections A, B and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for the Proposed Rule Change
1. Purpose
The proposed rule change amends the Phlx's fee schedule to impose a
new foreign currency option participation fee of $2,000 annually, to be
billed semi-annually, effective July 1, 1999, to all foreign currency
options participants. Only those foreign currency options participants
who hold legal title as of July 30, 1999 are responsible for payment of
the participation fee. Thus, although the fee is effective July 1,
1999, it only becomes payable by participants as of July 30, 1999.
The Exchange is proposing to implement the foreign currency options
participation fee to help defray operating expenses of the foreign
currency options program. The proposed participation fee will address
costs associated with the foreign currency options program, including
occupancy, Securities Industry Automation Corporation (SIAC) night
processing, market data feeds, staffing and communications.\7\
---------------------------------------------------------------------------
\7\ The proposed participation fee is in addition to the
existing membership dues that Phlx imposes on its members, and also
separate from the $2,000 user fees owed by foreign currency options
participants who are not also members of the Phlx. Foreign currency
options participants who also hold Phlx memberships are exempted
from the foreign currency user fee.
---------------------------------------------------------------------------
The Exchange also proposes to amend its fee schedule to reflect
that it will bill its existing technology fee in semi-annual increments
of $600 (instead of monthly increments of $100). The Exchange further
proposes that it will not apply the technology fee to foreign currency
options participants who are also Phlx members to avoid double billing.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6 of the Act \8\ in general, and furthers the objectives
of Section 6(b)(4) \9\ in particular, in that it provides for the
equitable allocation of reasonable dues, fees and other charges among
its members and other persons using its facilities. The Phlx believes
that the foreign currency option participation fee is reasonable and
equitable because, in addition to covering costs, it is comparable to
other Phlx fees and charges such as the technology fee.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78f(b).
\9\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
The Phlx does not believe that the proposed rule change will impose
any inappropriate burden on competition.
C. Self-Regulatory Organization's Statement on Comments on the proposed
Rule Change Received From Members, Participants or Others
No written comments were either solicited or received.
III. Date of Effectiveness of the Proposed Rule Change and Timing
for Commission Action
The foregoing rule change establishes or changes a due, fee or
change imposed by the Exchange and, therefore, has become effective
upon filing pursuant to Rule 19(b)(3)(A) of the Act \10\ and rule 19b-
4(f)(2) thereunder.\11\ At any time within 60 days of the filing of
such proposed rule change, the Commission may summarily abrogate such
rule change if it appears to the Commission that such action is
necessary or appropriate in the public interest, for the protection of
investors, or otherwise
[[Page 47888]]
in furtherance of the purposes of the Act.
---------------------------------------------------------------------------
\10\ 15 U.S.C. 78s(b)(3)(A).
\11\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Persons making written submissions
should file six copies thereof with the Secretary, Securities and
Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609.
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for inspection and copying in the
Commission's Public Reference Room. Copies of such filing will also be
available for inspection and copying at the principal office of the
Phlx. All submissions should refer to File No. SR-Phlx-99-20 and should
be submitted by September 22, 1999.
For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\12\
---------------------------------------------------------------------------
\12\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 99-22695 Filed 8-31-99; 8:45 am]
BILLING CODE 8010-01-M
